2000 (4) TMI 458 - AT - Central Excise

Summary

Issues:
Classification of goods under Central Excise Tariff Act, Calculation of assessable value under Rule 6(b)(ii) of the Central Excise (Valuation) Rules, 1975, Assessment of manufacturing cost for HDPE and PVC pipes.

Classification of Goods:
The appellant manufactured rigid HDPE and PVC pipes and fittings classified under Central Excise Tariff sub-heading 3917. A show cause notice was issued for recovery of Central Excise duty, interest, and penalty. The Commissioner confirmed the demand, interest, and penalty. The appellant disputed the claim, arguing that the goods should be classified under Chapter 84 instead of Chapter 39. The Tribunal directed the Commissioner to reevaluate the tax liability based on a previous decision and dismissed the argument that the pipes were part of a Sprinkler Irrigation System.

Calculation of Assessable Value:
The assessable value of manufactured goods should be calculated under Rule 6(b)(ii) of the Central Excise (Valuation) Rules, excluding duty paid on inputs. The Commissioner did not apply this rule, citing a previous Tribunal decision pending in the Supreme Court. As the Supreme Court dismissed the appeal, the Tribunal directed the Commissioner to reassess the tax liability based on the Tribunal's decision. The Commissioner was instructed to follow the law laid down by the Tribunal.

Assessment of Manufacturing Cost:
The appellant provided details of manufacturing costs for HDPE pipes, including raw materials, labor, profit margin, etc. The Commissioner rejected the data and fixed the manufacturing cost and assessable value without supporting evidence. The Tribunal found the Commissioner's assessment lacking acceptable data and remanded the matter for reevaluation based on Rule 6(b)(ii) of the Central Excise (Valuation) Rules. The Tribunal set aside the Commissioner's order, remanding the issue for a new decision with a reasonable opportunity for the appellant to be heard.